On November 23, 1998, attorneys general representing 46 states, the District of Columbia, and the five U.S. territories signed an agreement with the major cigarette companies to settle all the state lawsuits seeking to recover the Medicaid costs of treating smokers. The Master Settlement Agreement, or MSA, contractually imposes some restrictions on tobacco advertising, marketing, and promotion and requires the manufacturers to make annual payments totaling about $206 billion through 2025. It follows earlier individual settlements with four states--Mississippi, Florida, Texas, and Minnesota--totaling more than $40 billion over the first 25 years. Cigarette price increases have passed on those settlement costs to smokers.
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